Misleading advertising / Comparative advertising

This page was last modified on 03-08-2015

Advertising is a form of communication used in the framework of a commercial, industrial, trade or liberal activity, which aims to promote the provision of goods or services. This commercial practice is regulated by law so as to boost competitiveness and protect consumers.

Misleading advertising

Definition

Advertising is deemed to be misleading if it produces one of the following effects in any way, including by its presentation:

it deceives or is likely to deceive the persons it is aimed at or reaches;

it affects or is likely to affect the economic behaviour of the persons it is aimed at or reaches.

Components of misleading advertising

To determine whether an advertisement is misleading, the following are taken into consideration:

the characteristics of the goods or services, namely:

their availability;

their nature;

their execution;

their composition;

their quantity;

their specificities;

their geographic and commercial origin;

the results that may be expected from their use;

the essential results and characteristics of tests and controls undertaken on those goods or services;

the price of the goods or services, or the calculation method of said price;

the conditions of the provision of the goods or services;

the nature, quality and rights of the announcer, such as:

their identity and assets;

their qualifications;

their industrial, commercial or intellectual property rights;

the awards or distinctions received.

Examples of misleading advertising

Availability of the goods or services

The professional is at fault if:

he promotes a product on condition that another product is purchased at a given price and he then:

refuses to provide the consumer with the product that was advertised;

or refuses to order this product or to deliver it within a reasonable deadline;

or provides a defective sample of the product;

he makes false declarations regarding the availability of a product (limited stock or availability for a limited amount of time), in order to pressure the consumer and deprive him of the sufficient reflection period to make a choice in full knowledge;

he declares or gives the impression that the sale of a product is legal when in fact it is not (illicit sale);

he provides false information on the market conditions or the possibility to acquire a product in order to push the consumer to purchase said product at less favourable conditions than those of normal market conditions.

Results that can be expected from the use of the goods or services

The professional is at fault if:

he provides false information regarding the nature and magnitude of the personal safety hazards to which the consumer or his family is exposed if he does not purchase the product (information on hazards);

he declares that a product increases chances to win at gambling;

he falsely declares that a product can heal illnesses, dysfunctions or physical malformations (health benefits).

Essential results and characteristics of tests or controls undertaken on goods or services

The professional is at fault if he publishes, in the written press, on television, on the Internet or in any other media, content (text, images or sound) that aims to promote his product or advocate the use of his brand without clearly indicating to the consumer that he himself has financed this content (infomercial).

Price

The professional is at fault if:

he offers products at very advantageous conditions and/or at a very limited number in advertisements without actually having this stock or having already run out of stock (bait advertising);

he falsely declares that a product is free, e.g. by describing a product as being "free", "free of charge", "without charge" or in other similar terms, if the consumer must pay other costs than those linked to acquiring the article or to its delivery;

he declares that a contest if organised or that a prize may be won without actually awarding the described prizes or a reasonable equivalent (fictitious competition).

Supply conditions

The professional is at fault if:

he commits to providingafter-sales service in a language other than the official language in the Member State where he is established, without clearly informing the customer of this before any transaction;

he gives the false impression that after-sales service for a product is available in a Member State other than the one where the product is sold;

he presents the rights usually granted to customers by law as a promotional offer or as an exceptional proposal (advertising including rights granted by law);

he includes an invoice or a similar document in which a payment is required in the promotional material so as to give the consumer the impression that he has already ordered the product(s) in question (false invoices).

Quality of the announcer

The professional is at fault if:

he claims to be signatory of a code of conduct when in fact he is not;

he falsely claims that a code of conduct has received the approval of a public entity or other;

he displays a certificate, a quality label (or equivalent) although he has not obtained it;

he falsely claims that he, another professional or a product were accredited, approved or authorised by a public or private entity, without complying with the conditions of the accreditation, authorisation or approval received;

he falsely declares that he is about to cease his activities or relocate elsewhere.

Identity of the announcer

The professional is at fault if:

he promotes a similar product to that of a specific manufacturer, so as to deliberately induce the consumer to think that the product is from said manufacturer when in fact it is not;

he falsely claims or gives the impression that his actions are not linked to his commercial, industrial, craft or liberal activity, or he falsely presents himselfas being a customer.

Advertising favouring unfair competition

It is forbidden to promote pyramid schemes, i.e. induce the consumer to believe that he will receive an advantage (commercial discount, money, etc.) if he gives an more or less important initial sum of money and incites other customers to enter this scheme and in turn pay a contribution.

Example: falsely telling a customer that by buying a product he will get one free product or a discount on a product if he finds 10 other buyers. These buyers will then have to find 10 other persons, and so on.

Comparative advertising

Definition

Advertising is deemed to be comparative if it explicitly or implicitly designates a competitor or goods or services offered by a competitor.

Requirements to be met

Comparative advertising is authorised, provided that:

it is not misleading (see "Misleading advertising");

it objectivelycompares one or several essential, pertinent, verifiable and representative characteristics of the goods and services, of which the price can be one;

it does not generate confusion between the announcer and a competitor or between the announcer's brand, trade name, other distinctive signs, goods or services and those of a competitor;

it does not discredit or disparage a competitor's brand, trade name, other distinctive signs, goods, services, activities or situation;

in the case of products with a protected designation, it refers to products with the same designation;

it does not unduly benefit from the reputation attached to the brand, trade name or other distinctive signs of a competitor or of the protected designation competing products;

it does not represent a good or service in a way that imitates or reproduces a good or service baring a protected brand or trade name.

All comparison that references a special offer must clearly and unequivocally indicate the date when the special offer ends or, where applicable, the fact that it is valid until the goods or services are run out of stock. If the special offer has not started yet, the advertisement must indicate the start dateof the period during which a special price or other specific conditions are applicable.

Appeals in case of a breach of the legal provisions

Who to contact?

Any person who is a victim of a breach of the rules governing advertising and commercial practices in general can get information and assistance at:

Seeking an injunction

Where applicable, consumers can file a request and seek an injunction from the District Court dealing with commercial matters.

Proof of a loss or real damage is not necessary; the law provides that an injunction can be ordered based on the mere possibility and not the actual existence of a damage.

However, professionals who apply for an injunction must be in competition with the other party for their request to be accepted.

Generally, in the case of misleading or comparative advertising, only the announcer can be challenged for a breach of the provisions governing advertising. However, in the event that the latter is not established in Luxembourg or does not have a designated responsible person established in Luxembourg, an injunction can also be filed against the editor, printer or distributor of the advertisement in cause, as well as against any person who contributes to its effects.

Procedure

The injunction is filed with and judged by a summary judge, i.e. in an emergency procedure in order to stop the activity harming the collective interests of consumers as soon as possible.

Burden of proof

Given the legitimate interests of the announcer and of any other party to the procedure, the judge can:

demand that the announcer provide evidence of the accuracy of the data contained in the advertisement and, in the case of comparative advertising, demand that the announcer provide proof in the shortest time;

consider the data as inaccurate if the proof requested is not appropriate or deemed insufficient.

Sanctions in case of breach of the legal provisions

In the case of a breach of the legal provisions governing advertising, the judge can order that:

the decision be displayed outside the offender's sales establishments at his own expense;

the decision be published, in total or in excerpts, at the offender's expense, in newspapers or in any other way;

a penalty payment be made, i.e that a sum of money be paid per day of delay if the condemned party does not comply with their obligation;

in case of an acquittal, a publication or display of the decision be made at the State's expense.

The professional risks to be fined from EUR 251 to EUR 120,000 if he does not comply with the injunctions or prohibitions determined by the judge.